California’s Slow Response to Fraud Cost Billions, Auditor Says

California’s unemployment department took months to begin correcting mistakes that led it to process more than $10 billion in bogus claims for jobless benefits, exposing the system to a greater level of fraud, the state auditor said Thursday in the second scathing report this week on the agency’s handling of Covid-19 pandemic claims.

The Employment Development Department’s (EDD) approach to stopping fraud “was marked by significant missteps and inaction,” including suspending safeguards put in place to prevent impostors from collecting benefits, California State Auditor Elaine Howle said in the report.

The report adds to the controversy surrounding the agency’s ...